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Tuesday, May 24, 2011

Diageo in talks to purchase Jose Cuervo -- Bloomberg, (DGE)

Diageo Plc (DGE.L), the maker of Johnnie Walker scotch and Smirnoff vodka, is in talks to purchase tequila brand Jose Cuervo for more than $2 billion, Bloomberg reported on Tuesday. Cuervo is in exclusive talks with Diageo, which has the first option to buy the company because of its international distribution rights to the brand, Bloomberg reported. Diageo declined to comment. Earlier this month, Reuters reported that the maker of Jose Cuervo, the world's best-selling tequila brand, was not considering putting the property on the block, despite being courted by other companies eager to add the drink to their portfolios. Juan Beckmann Vidal, chairman of Casa Cuervo and heir to a tequila empire founded in the late 1800's, said his company is renegotiating a distribution deal it has with long-time partner Diageo, which he said is due to expire in late 2012.